There is a $2,000 tax credit available to Americans - how to claim it and who qualifies

For Americans with retirement accounts who qualify, the Internal Revenue Service (IRS) offers a $2,000 tax credit.

Those who contribute to an IRA or employer-sponsored retirement plan qualify for the saver's credit, which provides tax credits.

Investing in eligible retirement accounts qualifies for a tax credit of 10%, 20%, or 50%.

The credit cannot be applied to rollover contributions.

Contributions to the Achieving a Better Life Experience (ABLE) account may also qualify for a credit.

States can create tax-advantaged savings programs for people with disabilities under the ABLE Act.

Beneficiaries can use these funds to pay for qualified disability expenses.

The IRS deems distributions tax-free if they are used for qualified disability expenses.

If you've recently received distributions from a retirement plan, an IRA, or an ABLE account, your eligible contributions may be reduced.

Your credit amount is based on your income, and the thresholds change each year.

Claiming and eligibility

Taxpayers can claim up to $2,000 in credit for retirement account contributions if they file as a single person or $4,000 if they file jointly.

For single tax filers who contribute the maximum to their retirement accounts, 

The maximum credit is $1,000, or $2,000 for married joint filers.

The following persons are eligible for saver's credit:

1. 18 or older

2. Unclaimed as a dependent on another's return

3. Not a student

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